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IT industry delivers advice on streamlining agency finance systems

Controller Danny Werfel on Wednesday took delivery of a White House-requested software industry report on government financial management and said agency leaders are already held accountable for protecting taxpayers against overly long time frames for acquiring information technology systems that can be obsolete by the time they're up and running.

The report, "Implementing a Sustainable Strategy for Federal Financial Management," is the work of an industry collaboration organized by the American Council for Technology-Industry Advisory Council, a nonprofit educational group that assists government in acquiring and using information technology resources.

Requested last year by a working group within the Office of Management and Budget, the report was a needed opportunity for stakeholder input, Werfel said at the industry group's presentation. Federal officials realized during the past decade that the governmentwide IT modernization using commercial off-the-shelf financial systems was allowing some agencies to spend as long as "five to 10 years and up to $800 million" on what he called "big-bang" acquisitions with a preset "go live date" -- only to find that many were sticking to legacy systems along the way.

It dawned on officials, Werfel said, that taxpayers' interests could be protected if managers were held accountable for maintaining quality performance during the years of "mixed environment" transition to new systems.

"It's like if your house is under construction for five years, you still want to enjoy your life," Werfel said. What's more, he said, not all agencies need to modernize at the same pace, and not all agencies need to modernize everything.

Using another analogy, he said many agency financial management systems are like ATMs. "An old one might have a green, DOS-like screen while a new one may offer a video and a Starbucks coupon," he said. "But both give you your $60, your results and there are many green-screen ATMs still around the government."

OMB's goal in the past year, as it has frozen IT purchases pending a review, he said, is to "twist the axis a bit" to seek a sustainable model, rather than insisting on a clear beginning and a clear end to a software acquisition.

To seek the advice of stakeholders in private industry to better align software availability with agency needs is "a healthy and good example of government working effectively," Werfel said.

The industry teams preparing the report were asked to address several key questions:

-- How can agencies working with hybrid systems maintain and improve functionality?

-- When is a system on its "last legs?"

-- Is there a way to incentivize software providers to introduce upgrades that serve the taxpayer?

-- And what emerging paradigms might help address the other challenges?

The ACT-IAC report's overall solution is built around what it calls the Sustainment Strategy, or providing government entities "the ability to objectively assess and manage financial system components and determine the best path forward, whether that be modernizing or maintaining a steady state."

The hybrid environment is best addressed, the report said, through what it describes as "capability portfolio management" that focuses less on organizational systems or geographical units and more on strategic capabilities.

The last-legs question is best answered through standard decision criteria applied to each agency's unique situation, it said.

Incentives for the private sector to provide software upgrades inexpensively and timed to federal budget cycles can be brought to bear through improved coordination and communication, and by designating within an agency an "emerging requirements lead" to serve as the "voice of government" for software providers, a presenter said.

The promising new paradigms the report recommends include nine new technologies, three financial system deployment methods and three business models, among them cloud and service-based approaches.

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